India, Vietnam call truce in trade spat; Delhi pledges pest-free goods

New Delhi, March 28:

India has decided to extend the hand of reconciliation to Vietnam to avoid a repetition of a recent spat which both countries banning each other’s farm products, including coffee beans and peanuts.

Agriculture Ministry officials have assured their Vietnamese counterparts that India will take corrective action to ensure that Vietnam’s concerns relating to the presence of live pests in farm consignments from India are addressed, an Agriculture Ministry official told BusinessLine.

Vietnam recently banned the import of five agriculture products from India, which would have been effective from June 2017, but after New Delhi retaliated by placing an immediate ban on six Vietnamese products, including coffee, on March 7, it revoked its order.

“We do not want to come across as arm-twisting our trade partners, although we have ourselves been arm-twisted for long,” the official said. “We have assured Vietnam that we will take corrective action to make our consignments pest-free and we are in talks on the same.”

The corrective measures would include identifying the problem (to establish if just one or two companies were exporting pest-infested products or if it was more widespread), tightening of inspection of fumigation facilities and export procedures.

Since New Delhi, too, has revoked its ban on Vietnamese products, the South East Asian country has similarly said it will address India’s concerns, the official added.

The problem started four weeks ago, when Vietnam announced it would suspend import of peanuts, cassia seed, cocoa beans, haricot beans and tamarind from India as it had found live insects in consignments shipped from here.

Days later, India issued an order temporarily suspending the entry of coffee beans, bamboo, black pepper, cinnamon, cassia and dragon fruits from Vietnam, claiming repeated interception of quarantine pests.

However, since India announced the implementation of the ban with immediate effect, Indian coffee producers were impacted at once.

There were also expressions of concern from Vietnamese exporters who had their consignments waiting to be shipped at ports.

“Since business from both sides was getting hurt, the two countries decided to call a truce and lift the ban. Our trading partners have to trust us when we assure them that we are putting in place the processes to ensure pest-free consignments,” the official said.

Vietnam had earlier suspended imports of peanuts from India in April 2015. The ban was lifted in January 2016 after a Vietnamese delegation visited India and inspected fumigation facilities, export procedures and the export certification system for peanuts.